Today we shall take a look at the EUR/USD currency pair. Since the middle of last week, the euro has found a new strength to push against the dollar, and the price of this pair has been gradually increasing.
Last week proved favorable for the European single currency. CPI reports met the forecasts, while the GDP update, both from Germany and the eurozone as a whole, exceeded investors’ expectations and showed growth for the first time in a while. This was enough to stop the descent of the euro and allow it to recover some of its lost positions. The schedule is a bit less hectic this week, as the most important events that could influence the euro have to do with announcements from the ECB, as well as newly-appointed ECB President Christine Lagarde’s first speech. It may still be too early to see results from this month’s QE, so we don’t expect any surprises in this week’s announcements.
The economic situation in the United States remains stable, despite a few shaky reports, including a slight decrease in one of the CPI reports from last week. However, right now the USD is seeing less interest from investors due to the positive developments in the trade negotiations with China. Both the US and China have signaled recently that an agreement is possible in the near future, which in turn spiked risk appetite and drew away from the reserve currency, allowing it to depreciate. This week’s most important event for the dollar will be the publication of the minutes from the Fed’s October meeting on Wednesday.
In terms of the daily chart, today we have a pivot point for the pair located at 1.1052, with the price currently trading above it. The daily support levels lie at 1.1049 and 1.1045. The daily resistances are located at 1.1056 and 1.1059. The indicators of technical analysis are leaning towards a sell recommendation today.
